Quetzal Case Analysis

Case: Quetzal Collections, Inc.

Quetzal Collections, Inc., a distributor of South American and African artifacts in 4 major cities of the U.S., faces increasing competition and external environment threats. Despite the firm's efforts to expand and improve the product line towards a competitive advantage, other competitors including retailers now enter the market bypassing and undercutting Quetzal. David Olsen, Director of Procurement, and Myron Rangard, the firm's national sales manager, are presented a major contract for the purchase of $750,000 in Quetzal merchandise including the supply of replicas.

Considering the firm's position, Olsen and Rangard must decide whether or not accepting the contract is the best course of action for the firm as a whole.

In order to understand the position of our firm (Quetzal) in the industry, we must define who we are, who our customers are, what do they value from us, and how do we create such value. We defined our business as the quality artifacts distribution business. Our primary customers are collectors who appreciate high quality and authenticity artifacts. We obtain our product line from different suppliers who are at the source where the artifacts are originally produced. Secondary customers include the ones that are not so keen in authenticity but like the artifacts as a decorative, rather than a collector's, item.

To determine the suitability of the opportunity at hand, and the best direction to take, we must now analyze the direct forces and indirect factors affecting the firm's position.

There is high risk from increasing rivalry such as new distributors and even the firm's own buying retailers who are dealing directly with our suppliers. With the low barriers to entry into the industry, anyone can obtain and even manufacture artifacts and introduce them into the market even if these are not authentic. Buyers have great power as they have other distributors to buy from and often our products are not the main output of buyers. On the other hand, noting that suppliers have more buyers like us, they have more power to dictate price, which can raise costs. Our market, the dedicated in artifact quality and authenticity for collection